Industrial Organization: Applied Frameworks

Industry & Firm Analysis: Your Strategic Toolkit

Understand your competitive landscape and your position within it.

1. Porter’s Five Forces (Analyze the INDUSTRY)

• Threat of New Entrants: [ ] How easy is it for new players to join?
• Bargaining Power of Buyers: [ ] Can customers easily demand lower prices?
• Bargaining Power of Suppliers: [ ] Can suppliers easily raise their prices?
• Threat of Substitutes: [ ] Are there alternative products that meet the same need?
• Rivalry Among Existing Competitors: [ ] How intense is the fight between current players?
• Why: Stronger forces = less attractive industry.

2. SWOT Analysis (Analyze YOUR FIRM)

• Strengths (Internal): [ ] What are you good at? Unique advantages?
• Weaknesses (Internal):]: [ ] What do you do poorly? Internal limitations?
• Opportunities (External): [ ] Favorable market conditions you can exploit?
• Threats (External): [ ] External factors that could harm you?
• Why: Helps connect internal capabilities with external realities.

Your Action:

• Pick one of your key products/services.
• Briefly analyze its industry using Porter’s Five Forces.
• Then, perform a quick SWOT for your firm in that specific market.

Golden Rule: Don’t just list factors. Analyze how strong each force is, and how you can leverage your strengths to counter threats or exploit opportunities.